The Blind Owl (1987, Raoul Ruiz)

He cuts up some woman and puts her body in a trunk. On a train, a man tells stories about a mysterious rider with a companion speaking to him from inside a small suitcase.
Mentions of Grenada and Marrakesh
Middle-east parody?
Communicating by dance
Protagonist tends to wail
The subtitled part is the movie our protag is watching
White-robe is the Sailor? from Three Crowns? Yes he is.
Very good string music, reminiscent of Three Crowns
Protag has no memories.

Some of this will be wrong, and much will be left out. I will happily watch the movie again, hopefully from some glorious high-res copy released in the future, not a fan-subtitled compressed file made from a two-decades-old beta videotape.

To start with, our guy gets a job at a movie theater. “The films we projected, I never knew who chose them, but I think that nothing that was shown was ever watched.” He and erratic coworker Kasim sleep in the projection booth, living there with Kasim’s girlfriend Fatima. Our guy meets an unknown uncle, then an unknown nephew, then goes on a journey (see note above about cutting up and trunking some poor woman).

Suddenly: “Here begins the story of Aba Yahyar ibn Abu Bakhra as recounted by Ibn Abas may it please Allah”. A riddle-spouting djinn sets a crazily fake-bearded young man searching for his crazy uncles, then he finds the “seven sleepers of ephesus” inside a giant mouth (flashback to the giant teeth in City of Pirates). Also, twin brothers (“the only thing that distinguished them was that one drank more water”) love the same woman. Took me a while to realize that all this is the film-within-the-film.

Bearded man seeks uncle:

Giant teeth:

Back in the projection booth, Fatima eats and drinks sound and images by grabbing them off the projector beam with her hand, and our guy gets into a bloody fight with Kasim. Back in the inner film, more uncles and twins starts to jumble together. “Thus I discovered I no longer needed to watch the film. Henceforth, it would be part of me. I would see it projected on the walls of my room, on the face of my nephew and on the sheets of my bed. I could discern it in a dog’s bark, a man’s groan or a bird’s song, all of them telling me one grand tale of my two fathers, my two uncles and my mother, the dancer.”

Sailor:

The Sailor says he collects the decapitated heads of thieves, shows off his heads and one removed eye to Rosalia (the inner film’s fascinating mystery woman). Back at the theater, our protagonist comes to some final realization (“I’ve never had any memories, and in the space of that day I had aged some fifty years”) and leaves the building, ghostlike.

From (the only) IMDB review:

So not a fiction film but about fiction, immortal stories without particular author or answer, that always seem to begin by their narrator with “I heard a story”…

Based partly on a Persian novel by Sadegh Hedayat. A plot summary of the 1975 film version sounds twisty and surreal, and almost nothing like the Ruiz version except that it involves a young man fixated on a memory of a glimpsed “ethereal” woman.

Hard to tell which actors played whom, but Jean-François Lapalus is the lead, and Jessica Forde (star of Rohmer’s Four Adventures of Reinette and Mirabelle) was in there somewhere.

Maybe right here:

“It is at once an enormous joke and a cosmic, existential work on the human condition.” There’s little writing on this obscure Ruiz feature online, but Rouge has published an essential Luc Moullet piece.